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National Postal Forum: Change or Die

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It's the third time the payment has been missed.
It's the third time the payment has been missed.

Let me begin by saying that I have a soft spot for the USPS. My uncle, who got a BS in chemistry at UC Berkeley, nonetheless opted for a career as a carrier for the USPS. His route took him through seedy Hunters Point in San Francisco—a route that he opted to keep because his customers got so little mail, he was usually done by noon. At which point, he could take his USPS truck and park anywhere in the city. Those were the days, I suppose.

While the overall mood at the 2012 National Postal Forum is upbeat and optimistic, if I were less charitable, I would say the real theme isn't as much “Technological Innovation” as it is “Change or Die.” We already know how the USPS ended the first three months of its 2012 fiscal year, with $3.3 billion in net losses. The agency is on the verge of bankruptcy. In response, the USPS has initiated a full-court press to attract customers and drive business, whether by added training to improve in-store customer service or by targeting markets like small- and medium-sized businesses.

Despite this publicity, nobody seems to agree on the causes of the USPS's money problems, whether it's decreasing mail volumes as digital communications rise, the 2006 institution of prepaid employee benefits or the agency's inability to cut costs. The USPS released its plan for long-term financial stability in February, which must first be approved by Congress, as the agency doesn't have the authority to act independently on changes of this magnitude.

In other words, the fact that it's beholden to Congress (which moves at a pace that can only be considered fast when compared with something like continental drift) means the USPS can't take expedient action when it most needs to. Patrick Donahoe, the Postmaster General, was frank in his assessment of the Congressional process during the keynote: "It doesn't benefit us to have this stuff dragging on because it creates [misconceptions] about the industry," he said.

The more radical response, suggested by the Cato Institute, would require privatizing the USPS and eliminating its monopoly on mail delivery. It doesn't seem to be a popular option, but it wasn't in Sweden or the Netherlands, where it happened. And the UK will begin privatizing its Royal Mail service in 2013. Privatization isn't a silver bullet: it helped the Swedish post financially, but in the Netherlands, it has apparently left a trail of angry workers and dissatisfied customers.

The USPS is currently publicizing its GoPost pilot, inspired by a similar service in Europe. If the situation gets dire enough, this might not be the last idea the USPS borrows.

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